LFB projects Wisconsin budget hole

Wisconsin is facing a $143 million shortfall for this biennium, according to an annual analysis released Thursday by the Legislative Fiscal Bureau — that’s almost $216 million below the nearly $73 million surplus that was projected in October.

Representative Robin Vos (R-Rochester) blames the “slower than anticipated” national recovery from the Great Recession. “It’s not a surprise when we look at what’s happening all around the country. Wisconsin is one of 29 states that show that the slowdown in the national economy is having an impact on our state budget.”

The Fiscal Bureau says the downward fiscal outlook is mostly due to a $273 million drop in projected tax revenues. The new estimate could trigger the need for a budget repair bill, but Vos, who’s on the legislative budget writing committee, disagrees. He says Wisconsin will end the first year of the two-year budget with a surplus. It’s the second year that will have to be reevaluated. “Hopefully we will not have to make cuts, but if the choice is between raising taxes and cutting, you know, the bureaucracy, we’ll of course choose to cut the bureaucracy in a way that doesn’t impact the public.”

The administration is also looking at debt refinancing, restructuring, and tapping into the budget stabilization fund — or the “rainy day” fund.

Governor Scott Walker remains optimistic. In a statement, he says when compared to other states “Wisconsin is headed in the right direction” and his administration “will continue to manage the Wisconsin taxpayer’s money well.”

Democratic Party of Wisconsin Chair Mike Tate released a statement saying, “Wisconsin’s budget condition has deteriorated to the point that emergency action may be required,” he says, “Today’s news is one more reason why the people will recall and replace Scott Walker.”

Assembly Minority Leader Peter Barca (D-Kenosha) released a statement saying, “The evidence is clear – Gov. Walker’s economic plan is not working … When people are not working and not spending because of Republican priorities, the state is going to see a drop in revenues.”

Representative Cory Mason (D-Racine) is the ranking Assembly Democratic member of the legislature’s Joint Committee on Finance. In a statement, he says, “This projected shortfall does not even include the more than $140 million deficit in Wisconsin’s Medical Assistance program, or the yet-to-be approved $174 million in cuts required by Walker’s biennial budget.”

In a joint statement with Vos, Senator Alberta Darling (R-River Hills) says Wisconsin is suffering from the Great Recession like many other states: “According to the National Conference on State Legislatures, 29 states projected an estimated $31.9 billion budget gaps for fiscal year 2013. In addition, nine states currently project budget gaps in FY 2014, totaling $16 billion.”